By Nelson Bocanegra
BOGOTA (Reuters) - Disappointing third-quarter growth figures, falling inflation and recent comments by central bank board members could mean a cut in Colombia's benchmark interest rate at a meeting on Friday, according to a Reuters survey of analysts.
The nation has faced the fallout from lower oil prices and domestic consumption, as well as once-high inflation figures that split the seven-member board's focus.
Though 11 of 16 analysts estimate the monetary authority will hold the rate at 5 percent, the remaining five projected a cut of 25 basis points to 4.75 percent.
The survey took place after the government reduced its gross domestic product growth target for 2017 to 1.8 percent after reporting a smaller-than-expected third-quarter expansion.
In a central bank poll of analysts conducted just prior to the GDP data, the forecast was that policymakers would hold the interest rate steady through year-end.
Bank chief Juan Jose Echavarria said on Friday that the growth figures were lower than hoped, while Finance Minister Mauricio Cardenas, who represents the government on the board, said there remained space for cuts.
The board surprised the market in October by reducing borrowing costs by 25 basis points to 5 percent. Analysts had expected a hold.
"The GDP figures still show the economy needs more stimulation. If it's not lowered now, it could complicate the macroeconomic panorama due to an increase in rates by the (United States) Federal Reserve or negative news on an external level that might negatively impact emerging economies," said Andres Abadia of Pantheon Macroeconomics in London.
This month board member Juan Pablo Zarate told Reuters that the growth projections justify a more expansive monetary policy.
Expectations for end of 2017 inflation were down to 3.9 percent from 4.09 percent in October's survey, just within the bank's 2 to 4 percent target range. It would be the first time in two years that the figure has fallen below 4 percent.
"Recent comment by board members point to inflationary risks diminishing and the production gap widening, which we think will lead the board to head toward expansionist territory before we previously anticipated," Sergio Olarte of BTG Pactual said.
Still, the majority of analysts thought the rate would remain unchanged.
"Strategically, the position for the close of the year should be neutral, with which the bank will reinforce its message of complying with the inflation target. That's why we expected an unaltered rate in November and December," said Daniel Escobar of Global Securities brokerage.